Legislation that is supposed to rein in those who profit from Colorado’s agricultural tax breaks without actually farming or ranching cleared a key legislative panel Monday.
Supporters of House Bill 1146 predicted the full House will soon approve the measure and forward it to the Senate for consideration.
The legislation has the support of many county assessors despite their fears that it doesn’t do enough to help them fight those profiting from how Colorado taxes agricultural land.
On Monday, assessors and other county officials testified that the legislation would at least represent some movement on an issue they say has vexed them for decades.
“If nothing is done, it will perpetuate the blatant inequalities of the status quo,” said Hap Channell, chairman of the Gunnison County board of commissioners and a representative of Colorado Counties Inc.
Colorado taxes agricultural land on a production formula, not on what it would fetch on the private market. Property owners who qualify for the ag classification can slash a property tax bill by tens of thousands of dollars in some instances.
Under current law, the toughest requirement to qualify for the tax break is that property owners show they tried to make a profit through agricultural use, a requirement so vague that people can qualify by setting up minimal side ag operations, like letting cattle graze on the land a couple of days a year.
“The abuses are widespread and well-documented,” Channell said.
“These property owners are not meeting their obligations and are passing on their school taxes and road taxes and special district taxes on to average citizens like you and me,” Channell told legislators.
House Bill 1146, sponsored by state Rep. Tom Massey, R-Poncha Springs, would allow assessors to reclassify up to 2 acres of a farm or ranch at the residential tax rate if the home isn’t integral to an agricultural enterprise.
The legislation mostly would affect property owners in resort communities, like Aspen, who use the tax break, supporters said.
The House Agriculture, Livestock & Natural Resources Committee voted 11-2 on Monday to forward the legislation to appropriations for further debate and consideration. Reps. Glenn Vaad, R-Mead, and Marsha Looper, R-Calhan, dissented.
Some assessors objected to a last-second amendment that would define when homes would be considered “integral to an agricultural operation.” The amendment said that would occur when the occupant of the home “regularly conducts, supervises or administers material aspects of the agricultural operation.”
Montrose County Assessor Brad Hughes said he feared the amendment would make it difficult for assessors to restrict abuses of the system, but he still supports the legislation.
“At least it will give us one tool,” Hughes said. “It will be better than nothing at all.”
Massey said the amendment was a compromise reached by all the stakeholders, including the development community and farm interests. He predicted the House will pass the legislation.
Christopher N. Osher: 303-954-1747 or cosher@denverpost.com
